The Vanguard Total Stock Market Index Fund ETF Shares (VTI) and the iShares Russell 1000 Growth ETF (IWF) are both among the Top 100 ETFs. VTI is a Vanguard Large Blend fund and IWF is a iShares Large Growth fund. So, what’s the difference between VTI and IWF? And which fund is better?
The expense ratio of VTI is 0.16 percentage points lower than IWF’s (0.03% vs. 0.19%). VTI also has a lower exposure to the technology sector and a lower standard deviation. Overall, VTI has provided lower returns than IWF over the past ten years.
In this article, we’ll compare VTI vs. IWF. We’ll look at holdings and annual returns, as well as at their fund composition and industry exposure. Moreover, I’ll also discuss VTI’s and IWF’s risk metrics, portfolio growth, and performance and examine how these affect their overall returns.
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Summary
| VTI | IWF | |
| Name | Vanguard Total Stock Market Index Fund ETF Shares | iShares Russell 1000 Growth ETF |
| Category | Large Blend | Large Growth |
| Issuer | Vanguard | iShares |
| AUM | 1.26T | 72.16B |
| Avg. Return | 14.70% | 17.72% |
| Div. Yield | 1.26% | 0.52% |
| Expense Ratio | 0.03% | 0.19% |
The Vanguard Total Stock Market Index Fund ETF Shares (VTI) is a Large Blend fund that is issued by Vanguard. It currently has 1.26T total assets under management and has yielded an average annual return of 14.70% over the past 10 years. The fund has a dividend yield of 1.26% with an expense ratio of 0.03%.
The iShares Russell 1000 Growth ETF (IWF) is a Large Growth fund that is issued by iShares. It currently has 72.16B total assets under management and has yielded an average annual return of 17.72% over the past 10 years. The fund has a dividend yield of 0.52% with an expense ratio of 0.19%.
VTI’s dividend yield is 0.74% higher than that of IWF (1.26% vs. 0.52%). Also, VTI yielded on average 3.03% less per year over the past decade (14.70% vs. 17.72%). The expense ratio of VTI is 0.16 percentage points lower than IWF’s (0.03% vs. 0.19%).
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Fund Composition
Industry Exposure
| VTI | IWF | |
| Technology | 24.1% | 39.29% |
| Industrials | 9.39% | 6.19% |
| Energy | 2.77% | 0.28% |
| Communication Services | 10.4% | 12.82% |
| Utilities | 2.29% | 0.03% |
| Healthcare | 13.64% | 9.23% |
| Consumer Defensive | 5.77% | 4.31% |
| Real Estate | 3.59% | 1.85% |
| Financial Services | 13.77% | 7.36% |
| Consumer Cyclical | 11.83% | 17.62% |
| Basic Materials | 2.44% | 1.01% |
The Vanguard Total Stock Market Index Fund ETF Shares (VTI) has the most exposure to the Technology sector at 24.1%. This is followed by Financial Services and Healthcare at 13.77% and 13.64% respectively. Basic Materials (2.44%), Energy (2.77%), and Real Estate (3.59%) only make up 8.80% of the fund’s total assets.
VTI’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Healthcare stocks at 5.77%, 9.39%, 10.4%, 11.83%, and 13.64%.
The iShares Russell 1000 Growth ETF (IWF) has the most exposure to the Technology sector at 39.29%. This is followed by Consumer Cyclical and Communication Services at 17.62% and 12.82% respectively. Energy (0.28%), Basic Materials (1.01%), and Real Estate (1.85%) only make up 3.14% of the fund’s total assets.
IWF’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Financial Services, Healthcare, and Communication Services stocks at 4.31%, 6.19%, 7.36%, 9.23%, and 12.82%.
VTI is 15.19% less exposed to the Technology sector than IWF (24.1% vs 39.29%). VTI’s exposure to Financial Services and Healthcare stocks is 6.41% higher and 4.41% higher respectively (13.77% vs. 7.36% and 13.64% vs. 9.23%). In total, Basic Materials, Energy, and Real Estate also make up 5.66% more of the fund’s holdings compared to IWF (8.80% vs. 3.14%).
Holdings
| VTI Holdings | Weight |
| Apple Inc | 4.9% |
| Microsoft Corp | 4.6% |
| Amazon.com Inc | 3.33% |
| Facebook Inc Class A | 1.88% |
| Alphabet Inc Class A | 1.66% |
| Alphabet Inc Class C | 1.56% |
| Tesla Inc | 1.18% |
| Berkshire Hathaway Inc Class B | 1.09% |
| NVIDIA Corp | 1.07% |
| JPMorgan Chase & Co | 1.06% |
VTI’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 4.9%, 4.6%, 3.33%, 1.88%, and 1.66%.
Alphabet Inc Class C (1.56%), Tesla Inc (1.18%), and Berkshire Hathaway Inc Class B (1.09%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the VTI’s holdings at 1.07% and 1.06%.
| IWF Holdings | Weight |
| Apple Inc | 10.51% |
| Microsoft Corp | 9.85% |
| Amazon.com Inc | 6.63% |
| Facebook Inc Class A | 3.91% |
| Alphabet Inc Class A | 3.2% |
| Alphabet Inc Class C | 3.03% |
| Tesla Inc | 2.45% |
| NVIDIA Corp | 2.14% |
| Visa Inc Class A | 1.91% |
| The Home Depot Inc | 1.62% |
IWF’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 10.51%, 9.85%, 6.63%, 3.91%, and 3.2%.
Alphabet Inc Class C (3.03%), Tesla Inc (2.45%), and NVIDIA Corp (2.14%) have a slightly smaller but still significant weight. Visa Inc Class A and The Home Depot Inc are also represented in the IWF’s holdings at 1.91% and 1.62%.
Performance
Annual Returns
| Year | VTI | IWF |
| 2020 | 20.95% | 38.21% |
| 2019 | 30.8% | 36.08% |
| 2018 | -5.13% | -1.68% |
| 2017 | 21.16% | 29.96% |
| 2016 | 12.68% | 6.92% |
| 2015 | 0.4% | 5.48% |
| 2014 | 12.56% | 12.84% |
| 2013 | 33.51% | 33.19% |
| 2012 | 16.41% | 15.03% |
| 2011 | 1.06% | 2.47% |
| 2010 | 17.26% | 16.47% |
VTI had its best year in 2013 with an annual return of 33.51%. VTI’s worst year over the past decade yielded -5.13% and occurred in 2018. In most years the Vanguard Total Stock Market Index Fund ETF Shares provided moderate returns such as in 2016, 2012, and 2010 where annual returns amounted to 12.68%, 16.41%, and 17.26% respectively.
The year 2020 was the strongest year for IWF, returning 38.21% on an annual basis. The poorest year for IWF in the last ten years was 2018, with a yield of -1.68%. Most years the iShares Russell 1000 Growth ETF has given investors modest returns, such as in 2014, 2012, and 2010, when gains were 12.84%, 15.03%, and 16.47% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| VTI | $10,000 | $42,648 | 14.70% |
| IWF | $10,000 | $55,920 | 17.72% |
A $10,000 investment in VTI would have resulted in a final balance of $42,648. This is a profit of $32,648 over 11 years and amounts to a compound annual growth rate (CAGR) of 14.70%.
With a $10,000 investment in IWF, the end total would have been $55,920. This equates to a $45,920 profit over 11 years and a compound annual growth rate (CAGR) of 17.72%.
VTI’s CAGR is 3.03 percentage points lower than that of IWF and as a result, would have yielded $13,272 less on a $10,000 investment. Thus, VTI performed worse than IWF by 3.03% annually.
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